Mortgages coup for UK’s bad bank

The 27,000 mortgages left over from Northern Rock and Bradford & Bingley, were sold to JPMorgan for £2.7 billion (Photo: EPA)

Some cheer for the UK taxpayer today as the Treasury’s “bad bank” UK Asset Resolution sold its largest package of mortgages at a £55 million profit.

The 27,000 mortgages, left over from Northern Rock and Bradford & Bingley, were sold to JPMorgan for £2.7 billion after an auction which began in June.

The sale was struck at a £55 million premium over book value, reflecting the improving background to the UK mortgage market.

It means that since UKAR was created four years ago to run down the more-risky parts of nationalised Northern Rock and B&B’s mortgage books it has reduced the size of its book from some £115 billion to £70 billion.

Such deals also raise the probability of the taxpayer actually emerging with a profit from the bailouts of the two former building societies.